Understanding Tax Filing

Why is it important to file taxes?

• To receive a bonus from your employer

• To increase your annual salary

• To report your income and ensure correct tax payments

• To avoid paying any money to the government

What is a W-2 form used for?

• Reporting dividends

• Reporting interest income

• Reporting capital gains

• Showing income earned and taxes deducted by an employer

Which form is used to report income for independent contractors?

• 1099-MISC

• 1098-E

• W-2

• 1099-INT

What does determining your tax filing status affect?

• The number of dependents you can claim

• The interest rate on your loans

• Your eligibility for deductions and credits

• The amount of your paycheck

Who can be considered a dependent on a tax return?

• A child or person you financially support

• A co-worker

• A friend living with you

• A neighbor

Which option is best for someone with a basic tax return and confidence in their tax knowledge?

• Ignoring tax filing

• Filing taxes manually using IRS instructions

• Using tax preparation software

• Hiring a tax professional

What is a benefit of using tax preparation software?

• It files taxes automatically every year

• It eliminates the need for any documents

• It helps find errors and missing information

• It guarantees a refund

What should you do before submitting your tax return?

• Ask a friend to file for you

• Ignore any errors

• Double-check for accuracy

• Submit without reviewing

What is the consequence of not paying taxes on time?

• Facing penalties

• Avoiding future tax payments

• Receiving a bonus

• Getting a tax credit

What is the final step in the tax filing process?

• Gathering documents

• Choosing a filing method

• Submitting the tax return

• Determining filing status